Imagine if you could’ve bought the keys to the Internet in 1994! A tectonic shift at the intersection of finance & technology approaches, where the very fabric of the global capital markets are being transformed at the atomic level for the first time since the advent of fungible currency is enabling such and opportunity now. Smart contract and the blockchain allow the creation of global P2P capital markets. Purchasing Veritas tokens is analogous to purchasing the keys to the most monumental paradigm shift since the advent of the Internet!

And of course the inevitable... What happens when a less expensive product is introduced into the market with similar or superior attributes? Margin Compression! We analyzed three big Wall Street banks, starting with the "Riskiest Bank on the Street" (time permitting, reference our hard hitting, prescient research from early 2008).

You will get to touch, play with and trade value via UltraCoin. Below is a screenshot of UltraCoin running on a Mac. I will also be taking applications for large scale beta testers and entities who wish to have customized value trading solutions created for them.

At elite universities, fewer MBA and finance candidates are willing to even consider a life of missed weddings, busted romances and deep-into-the-night deal negotiations. The percentage of Harvard Business School graduates entering investment banking, sales or trading dropped to 5 percent last year from 12 percent in 2006, while those entering technology almost tripled to 18 percent during that period.

At the University of Pennsylvania’s Wharton School, the percentage of MBAs entering investment banking dropped to 13.3 percent last year from 26 percent in 2006, while those entering tech more than doubled to 11.1 percent.

Those of you who have been following finance from the Wall Street/Bay Street/Canary Wharf perspective realize that this is a cyclical occurence. Basically, Wall Street falls out of favor with MBA whiz kids every ten years of so. But!!!! This time is different. This time around, Wall Street, et. al. is about to succumb to the destructive forces of technology that transformed, revolutionized, disintermediated, gutted and absolutely reinvigorated the media, news and retail industries.

That's right! The Internet Paradigm Shift has finally hit Global Finance... and it's going to hurt, and hurt a lot!

As many know, the I've poured my time and resources into a start-up by the name of UltraCoin. Many have been clamoring for white papers and details, and I have been purposely secretive about such. The reason? I needed to entrency protection from my competition - the money center banks. How did I do this? Well...

I patented the future of Global Finance!

This video illustrates my presentation to both the mainstream and alternative media as I start my capital raising rounds from venture capitalists and strategic investos alike. Check it out!

We're looking for financial and human capital as we prepare to expand globally. Financial capital is self-explanatory. On the human capital side...

We're seeking a full stack contract developer. Must be proficient in: Java or C#; git, bzr, or similar. Must have a solid understanding of: race conditions and how to avoid them; scalable concurrency and data integrity architectural concepts (replication, sharding, etc.); software development processes and best practices. Proficiency in some CRUD technology (*SQL, NoSQL, etc.) as well as and some scripting language (Javascript, PHP, Python, etc.) is highly preferred. Experience with the Bitcoin protocol is a huge plus. Your first interview is to e-mail your resume along with a response to this challenge: https://gist.github.com/mbogosian/28815ae606c663c983c3

Must be willing to sign an NDA. You should be knowledgeable and competent, but we prefer grit to genius. Prima donnas need not apply.

"Dominic Wilson and Jose Ursua of the firm's markets research division are first up. They argue that Bitcoin fails to meet both basic criteria of a viable currency: while there remains an outside chance for widespread acceptance as a medium of exchange, as a stable source of value, it has so far failed. That undermines the premise that Bitcoin could serve as a way of short-circuiting exchange rates in inflation-prone countries."

But wait a minute! Goldman's business business is growing at a fraction of this pace, and actually negative in some areas. So, if Bitcoin as a currency and payment system is a failure, what the hell is Goldmam? Of course, Business Insider goes on to report...

For most users what matters is not the comparison with other currencies, but a comparison with the volatility of the currency that they hold (dollars in the US for instance) in terms of the things that they need to buy. The volatility of consumer prices (in dollars) has been even lower than FX rates, even if measured over a period including the 1970s. Put simply, if you hold cash today in most developed countries, you know within a few percentage points what you will be able to buy with it a day, a week or a year from now.

This is Bullshit! Say it to the more mathematically challenged, my bonus hungry friends. Let's run the math using theusinflationcalculator.com:

As you can see, if you measure things from the '70s as the esteemed, erstwhile Wall Street aficiaondo from Goldman recommended, then you would have less than 17% of your buying power left. Yes, bitcoin is volatile, but its volatility stems from the price going up and down, while the USD has primarily just went down. You know that saying about the frog in the slowly heated boiling pot of water, right?

In addition, both of the largest Bitcoin payment processors absorb the exchange rate volatility for their customers, or did the best of breed Goldman analysts somehow overlook this pertinent fact?

Wilson and Ursua include this graph showing volatility of Bitcoin versus the Argentine peso, the yen, the euro, the pound, and U.S. inflation. It's not even close.

But wait a minute! If the largest payment processors absorb the volatility and market risk of their customers, then Goldman must assuredly be referring to the currencies above from an investment perspective, no?

Yes! Bitcoin is truly volatile, indeed, but the guy at Goldman are cheating, hoping that the rest of us don't know our finance and/or basic common sense. You see, they are looking at just one side of the equation - the side that favors fiat currencies and disfavors bitcoin. You see, risk is the price of reward. For every reward you seek, you pay a price in risk. The goal, as a smart investor, is to pay little risk for much reward. Goldman is trying to make it appear as if you are paying nothing but risk for bitcoin and getting little reward in return. Let's see how that pans out when someone who knows what they're doing chimes in. From the BoomBustBlogresearch report Digital Currencies' Risks, Rewards & Returns - An Into Into Bitcoin Investing For Longer Term Horizons:

GS return on equity has declined substantially due to deleverage and is only marginally higher than its current cost of capital. With ROE down to c12% from c20% during pre-crisis levels, there is no way a stock with high beta as GS could justify adequate returns to cover the inherent risk. For GS to trade back at 200 it has to increase its leverage back to pre-crisis levels to assume ROE of 20%. And for that GS has to either increase its leverage back to 25x. With curbs on banks leverage this seems highly unlikely. Without any increase in leverage and ROE, the stock would only marginally cover returns to shareholders given that ROE is c12%. Even based on consensus estimates the stock should trade at about where it is trading right now, leaving no upside potential. Using BoomBustBlog estimates, the valuation drops considerably since we take into consideration a decrease in trading revenue or an increase in the cost of funding in combination with a limitation of leverage due to the impending global regulation coming down the pike.

Now that we see how hard it is to truly produce Alpha, I query thee... What do you think would happen if a financial maverick, an out of the box thinker who's different from all of those other guys, got a seed round of funding for the most disruptive product to hit the finance world since the printing press? What if that seed round was for $8 million dollars, with a preferred A series coming right behind it? What would such a cash flush company do, being one of the most cash flush Bitcoin companies in the world? Hmmmnnn!!!

Speakin' of Goldman Sachs...

I anticipate being in the market very soon for (I'm not thier yet, but hopefully very soon):

CTO - Chief Technology Officer

COO - Chief Opertating Officer

General Counsel

CMO - Chief Marketing Officer

CFO - Chief Financial Officer

As well as skilled Java and Blockchain developers.

Hit me via reggie at ultra-coin.com if you have an interest in coming on board.

Bloomberg reports Royal Bank of Scotland Group Plc, Britain’s biggest government-owned lender, is on track for its largest pretax loss since 2008 after setting aside 3.1 billion pounds more ($5.1 billion) for legal and compensation claims. We will delve into this report in detail, but first a little background so we're all viewing 20/20.

I've been spending a lot of time rebuilding the banking system as software over a cryptocurrency framework. Basically, I'm building a more efficient, more "Trustworthy" financial system. Many are doubtful of these endeavors. I say, don't underestimate the effort. For one, a more efficient, more trustworthy system is sorely needed. Here we are, 7 years after the start of the great financial trainwreck that I'm known for predicting, and I'm still at it doing the same thing to the same industry. This is only possible when there's a structural problem in the industry. A problem that rapid advancements in technology are ripe to solve.

On Thursday, 11 April 2013 I penned, I Illustrate How The Irish Banking Cancer Spreads To The UK Taxpayer And Metastasizes Through US Markets! wherein I clearly illustrated that RBS is materially understating its liabilities AND even went so far as to include links to the SEC and the UK banking regulator so that US/UK taxpayers and investors can notify our erstwhile regulator(s) to the potential of financial shenanigans. The root of the problem is that RBS has materially under-reported its liabilities (in my oh so humble opinion.) Those that stress tested RBS (the same erstwhile professionals that allowed the Irish banks to pass their stress tests 3 months before they started collapsing) apparently overlooked humongous swaths of liabilities.

The amount of evidence that I produced to back my claims was prodigous...

What happened behind closed doors?

Ulster Bank gave a first floating charge in favor of the Central Bank of Ireland (an arm of the European Central Bank) and the Financial Services Authority of Ireland. U.S. investors would have had to rely on the contents of The Royal Bank of Scotland's 2008 Annual Accounts which apparently (in my opinion) concealed the existence of the CRO registered charges to the Bank of Ireland.

The provision includes 1.9 billion pounds for lawsuits and fines tied mostly to the sale of $91 billion of mortgage-backed securities from 2005 to 2007, the lender said yesterday. It follows agreements Deutsche Bank AG, JPMorgan Chase & Co. and UBS AG (UBSN) struck with U.S. regulators to settle claims they didn’t provide adequate disclosure about mortgage-backed debt sold in the housing bubble that preceded the 2008 financial crisis.

Are they referring to claims similar to the ones I made that RBS bought Ulster Bank full of unrecognized mortgage crap, levered up off it and hid the debt? I strongly suggest my readers brush up on how The Irish Banking Cancer Spreads to the UK.

More than five years after giving RBS the biggest bank bailout in history, the government still hasn’t been able to cut its 80 percent stake.

... “When the crisis broke, the bank was involved in a number of different businesses in multiple countries that have subsequently faced heavy scrutiny by customers and regulators,” McEwan, 56, said in yesterday’s statement. “The scale of the bad decisions during that period means that some problems are still just emerging.”

... The charges led the bank to cut its forecast for its core Tier 1 capital ratio, a measure of financial strength. RBS expects the ratio will be about 11 percent at the end of 2013, or as much as 8.5 percent under the latest rules set by the Basel Committee on Banking Supervision. That’s down from the company’s estimate of 11.6 percent and 9.1 percent in November.

“Fronting up to our past mistakes is very expensive, but RBS is a much stronger bank that can deal with these costs on its own while running a good capital position,” McEwan said on the call. “Dealing with these litigation and conduct issues is essential if we are to move the bank forward.”

Well, I still haven't noticed them come clean on the Ulster Bank charge issue. If they really are going to "Front[ing] up... past mistakes" then they really need to address this, no? If the Ulster Bank charges are included in the Basel capitalization guidelines, then RBS needs a bailout, and needs one Now! It doesn't end their though. On Monday, 20 May 2013 I queried Who is RBS? Royal BS... or the Royal Bank of Scotland, to wit:

"An independent Scotland would have an exceptionally large banking sector compared to the size of its economy - with banking assets of more than 1250 percent of Scottish [gross domestic product] - making it more vulnerable to financial shocks and the volatility of the sector," the Treasury report said on Monday.

The report pointed out Scotland's banking exposure would dwarf that of Iceland and Cyprus, two countries that faced severe banking collapses in recent years. Iceland's banks, for example, had assets equivalent to 880 per cent of GDP, while Cyprus, which faced a banking crisis in March, had total banking assets of around 700 per cent of GDP.

"At the end of September 2012, the two largest banks – the Cyprus Popular Bank and Bank of Cyprus – had assets in the region of 210 per cent and 175 per cent of Cyprus's GDP respectively."

"It is worth noting that, if Scotland became independent, its banking sector would be similarly concentrated (with two large players, Bank of Scotland and Royal Bank of Scotland and a number of smaller firms), and that an independent Scotland's domestic banking sector would be likely to be significantly larger than that of Cyprus (assuming no change to firms' domicile arrangements)."

I penned, I Illustrate How The Irish Banking Cancer Spreads To The UK Taxpayer And Metastasizes Through US Markets! wherein I clearly illustrated that RBS is materially understating its liabilities AND even went so far as to include links to the SEC and the UK banking regulator so that US/UK taxpayers and investors can notify our erstwhile regulator(s) to the potential of financial shenanigans. The root of the problem is that RBS has materially under-reported its liabilities (in my oh so humble opinion.) Those that stress tested RBS (the same erstwhile professionals that allowed the Irish banks to pass their stress tests 3 months before they started collapsing) apparently overlooked humongous swaths of liabilities. The charge documents referred to in the aforelinked article are definitively not apparent in the recent bank stress testing’ conducted by the European Banking Authority, at least not in the summary results that the EBA have made available. For those who are still skeptical, I beg thee reference the RBS Stress Test download.

To think, there are actually many who query as to why I seek to make a more efficient financial system...

With the latest advances in technology, I can literally replace large swaths of bank functions with software. Software that doesn't lie, cheat, steal, or screw you for a bonus! Zero Trust software...

If the RBS/Ulster Bank mortgage-backed secutities would have been traded through UltraCoin, rehyppthecation, double-spending, over-leverage, and thrice pledged assets would have been a thing of the past. These contracts are overollateralized (200%) and use no leverage, yet still hold the promise of significant return, not to mention a mere fraction of the cost of the big bank stuff. Will the dawn of this technology herald the end of fractional reserve banking as we know it?

Let it be known, Wall Street banks' profit margin IS my business model!!!

The third-quarter loss was $380 million, or 17 cents a share, compared with a profit of $5.71 billion, or $1.40, a year earlier, the New York-based company said today in a statement. Shares of the company rose 2.6 percent at 7:50 a.m. after profit adjusted for one-time items beat analysts’ estimates.

...The pretax legal charge was $9.2 billion, compared with $684 million a year earlier. Litigation reserves at the end of September were $23 billion, the bank said, adding that “reasonably possible” losses in excess of those reserves were $5.7 billion.

And the (now perennial) kicker...

JPMorgan rose to $53.90 in New York trading from $52.52 at the close yesterday. Earnings adjusted for one-time items were $1.42 a share, exceeding the $1.30 average estimate of 20 analysts surveyed by Bloomberg.

Pray thee tell me, how many times do "one time" items have to occur before they're no longer considered "one time" items???!!! JP Morgan "found" earnings in the form of reserve releases (again), from the press release:

JPMorgan Chase & Co. and the biggest U.S. banks face billions of dollars in legal costs related to their role in the financial crisis, threatening their profits and the stock price gains they made in 2010, analysts said.

JPMorgan, the second biggest bank by assets, reported $5.2 billion of legal costs in the first nine months of 2009, compared with a gain of $10 million in the same period a year earlier. The costs would rise if the bank reserves for multibillion-dollar lawsuits byLehman Brothers Holdings Inc. and the trustee liquidating Bernard L. Madoff’s firm.

... JPMorgan’s third-quarter net profit of $4.4 billion, up 23 percent from the year earlier, would have been larger if it hadn’t set aside $1.3 billion of pretax income for lawsuits and $1 billion for mortgage repurchases. Banks haven’t yet reported their results for the fourth quarter.

In a Nutshell, JPM’s quarterly results were downright horrible – as we expected and warned of in our previous quarterly analyses (see notes at bottom of page)…

JP Morgan’s Q3 net revenue declined 11% y/y (-5% q/q) to $24.8bn as investment banking revenue declined 18% y/y (-9% q/q) to $12.6bn from $13.9bn in the previous year and net interest income declined 2% y/y (-2% q/q, off of a combination of ZIRP victimization and a rapidly shrinking asset base and loan book) to $12.5bn versus $12.7bn in the previous year. Non-interest expense increased 7% y/y (-2% q/q) to $14.4bn as compensation expenses to net revenues remained broadly flat (28% vs 27.5%) while non-compensation expenses to net revenues jumped to 33% vs 23% in the corresponding period last year. As a result of “Fraudclosure” we expect this number to skyrocket next quarter. Overall, the efficiency ratio (total expenses-to-net revenues) increased to 60% vs 51% and we expect this ratio to spike next quarter as well as the banking business becomes even more expensive.

As a result, banks allowances for loan losses have decreased to 4.9% in Q3 from 5.1% in Q2 and 4.7% in previous year. Although under provisioning has helped the bank to mask its dearth in profits it has also materially undermined its ability to absorb losses if economic conditions worsen. The Eyles test, a measure of banks ability to absorb losses, has consequently worsened to 1.9% in Q3 from 3.7% in Q2 and 5.9% in Q3 09.

Wait a minute! If Reggie Middleton complained about reserve pulling and legal expenses 1,2 and 3 years ago and was proven right, how are the occurence of these items in 2013 to be considered "One Time" items????

As for Android, Google, Glass, security and privacy, I took the liberty of posting the discussion from the my last article on this topic. It should be of interest to both the paranoid and the techy types....

0#14 Continuing what I said on Google Glass — John Boyd2013-07-16 12:02

Reg, As to your replique to my comment about Google Glass being a real time snooping tool for the NSA, I would say that what you say is true for those of us with the technical skills to build from the Android source code and then load it on to our phones (maybe there is a business opportunity there). The other issue is whether one can control what gets automatically loaded on the phone subsequent to deploying one's own build. Most people would not be up for the challenge. But I'm seriously thinking there's an opportunity there!

Everything you do is being monitored at carrier level. The NSA taps the cables.

Anyone who thinks DuckDuckGo and StartPage are safe are delusional. Entry and exit points to these services are again tapped at the wire level. The NSA would have no problems in illiciting the certificates supporting https.

You can see why American telecom companies want the contracts to rebuild communication infrastructures in countries their Wmpire has just dismantled.

Yet through disinformation borne ignorance, we already have the masses clamoring for a "safe' closed proprietary OS like iOS as compared to an open tool chest exposed to oh so many eyes.

That's not true. No-one is choosing iOS or Windows OS in order to be "safe". Similarly, next to no-one is choosing Android in order to be safer either.

OS's are chosen because of the hardware people think they want after seeing the promotion. If not the hardware, people choose the OS because of the apps they've seen their friends use, or promoted 'cool' apps.

As you say Reggie about the banks, no-one cares until some large section of society really suffers a loss. When it comes to surveillance and police states, waiting for that loss means you've already left it too late (unless you're watching from another country..).

As an aside, I really don't see people warming to being so constantly connected to hardware/communication etc. You will get a lot of people adicted to it like they are the internet, 24 hour news etc but I think it will wear a lot of people down and they'll reject the idea in the longer term - even you took off the headset in the Keiser Report interview the other day as I presume it was a distraction?

>You don't have the ability to submit >changes to even be considered for >acceptance

Your precious Google bozos made a mess of their Open Source modules. They scooped up open source, made copies of it in such as way changes can't be freely propagate back and forth to the original Open Source they took.

They just scooped up Open Source, copied it and moved it into their brand new projects. Really just a copy and paste type hack.

Google are using Open Source, but have done so it such as way as not to contribute back to the ecosystem they are using. Yes, they have their own brand new Open Source project with a brand new name, but the original modules they scooped up won' have changes easily propagating back and forth.

This is what happens when Google hires people straight out of college with no real world experience. Like hires like.

Google Chrome is hardly a beacon of engineering brilliance on Google's part. The hard part was done by Apple - WebKit.Apple produced the first fast JavaScript compiler.

>Windows and iOS all have the same >problems, except for the facts that

Isn't the core of iOS based on the Open Source operating system FreeBSD? FreeBSD rocks.

Apple's Safari web browser is based on the Open Source component WebKit, which is turn in based on the Open Source web browser Konqueror. Apple's JavaScript to machine code compiler (used in their web browser Safari) is again Open Source.

WebKit is a HTML5 and CSS renderer and supports multimedia and much more.

Google based their Chrome web browser on Apple's WebKit. If it wasn't for Apple, Google Chrome would exist in its current form.

By the way when I've developed websites, I've noticed the exact same JavaScript bugs in Apple's Safari and Google's Chrome. I wonder how that could have happened. It could just be a coincidence.

As I said before even if you have the entire source of Android read by people around the world, it still isn't secure. There are so many other lines of attack outside the handset.

OK you do have a valid point. A mainly Open Source operating system has to be more secure.

But really there are so many lines of attack.

By default Android does not have good security - who you communicate with can still be tracked. You need to get 3rd party software to be really secure on Android.

Building an operating system from source code is a difficult operation. There will be so many dependencies. Not many people will be able to do this.

I may make mistakes in some of my points, but you are meant to read all of what I say and take it as a whole.

> Your multiple posts here

Isn't that an ad hominem attack?

I am not a fool. Nor am I something that has crawled out of the woodwork.

I run a small business that sells a relatively inexpensive product to a very large number of people. I've sold my product to Microsoft, Intel, Apple and a vast number of other companies. I am not a fool. I've even sold my product to at least two companies that Google has taken over.

You are incidentally one of my favourite guest speakers to appear on the Keiser Report. You concisely summarize Google's business model as cost-shifting. I can see the smartness is saying things concisely.

I do advertise on bing.com and on other websites as well. They charge $0.05 to $0.15 per click. As a lot of companies only get 1 sale per 100 website visitors, this is a fair charge.

Google charging $0.80 to $5 per click is excessive. I don't know why Google does this. Surely the number of potential advertising customers they have is vast. They should aim to have low costs and make it up on the volume. To extent this is what I do.

Look I am really trying to make a valid point here and what I say is echoed across the Internet.

Google charges advertisers too much. All their money for acquisitions and their internal army of people that can't write software anymore without getting a check book out and buying it has a cost. That cost is borne by advertisers.

All I am saying is that Google is a hard man over money.

I have studied all the other companies in my niche. I see competition selling products at a very low cost if they don't use Google advertising. I see competitors charge 50% more than me when they turn on Google Adwords.

I just want to get a word out that having everybody use Google has a cost. That cost is the increased cost of products sold by everybody that is not Google.

Google spanks you if you use the display network as they say your click-rate is lower and so your cost per click on the search network has to go up.

If you use an exact phrase match with the words x, y and z and another company with nothing to do with you occasionally advertisers with the words a, b and z, then Google will spank you again as they say the competition is paying more, when they aren't really your competition at all.

I see the cost of products sold on the Internet go up 50% and all the cash rolls into Google.

Monopolies are bad. People need to use other search engines such as ixquick.com and duckduckgo.com

I have a very balanced view. Your multiple posts here show that your view may be less than balanced. If you have a problem with Google's advertising methods, you should choose another provider. There are alternatives, particularly in social media. You can also alter your approach to Google. The algorithm change was likely more to improve the credibility of search results than to hurt your business. Either way, you can find experts that maximize efficacy of coding for Google search results. Comparing to Bing, Yahoo, etc. is less relevant they have inferior products when one factors in capabilities, which is likely why they have less market share.The network effect creates an unfair advantage, yes.... but to obtain the network effect advantage you likley had a superior product to begin with. Ask users of Microsoft Office...

> Who has the time to read through a mountain of computer source code? Computer source is difficult to read and understand. Reading source code written by other people and understanding it, will take longer than writing it yourself.

Nah! We are not protected.

Just listen to the objections you are raising and you can see how and why Android is safer to the populace than all of the popular competition. Windows and iOS all have the same problems, except for the facts that

You dont have access to the code

You don't have the ability to submit changes to even be considered for acceptance

With Android, you don't need for Google to accept your personal changes, you can simply roll your own personal version and use it for yourself which should be the preference for the paranoid types. You can't do this with any other popular OS.

The amound of independent eyes on Android trumps that of any other OS, by far. If something has a chance of getting caught (ex. spy code) it will likely get caught on Android code base. This has already happened, read XDA developers code posts for the HTC Evo

There is nothing to stop someone taking Open Source software and just before building it into runnable code, adding a crack to make intercepting or decrypting communication easier.

How can one little change be spotted in reams of incomprehensibl y machine code assuming you even know what version of all the different source code modules to compare against? Even if you read through all the code it would take you a lifetime.

> This means that anyone and everyone can > modify the code base and if those > modifications (improvements) are > accepted into the official code base

Yes, but there is still Google sitting as a referee deciding what gets into the official code base.

Suppose I want to triple the bit length they use for SSL / https, will Google let me submit the changes?

If all communication is being snooped then you have no protection. Even if you use encryption, the NSA will still have a record of who you are communicating with and how much traffic goes between you and where they are located.

Even if you use encryption, if the bitlength isn't high enough President ODumber will crack it. I don't know enough about cryptography, but if the algorithm has a flaw then you are vulnerable as well.

They can still tell what search terms you are using.

Do you use an encrypted email client? Encrypted voice over a phone line? How do you know for sure the software you download doesn't have a flaw in it. Very few people are smart enough to understand the level of mathematics to determine this, plus have knowledge of software as well. Who has the time to read through a mountain of computer source code? Computer source is difficult to read and understand. Reading source code written by other people and understanding it, will take longer than writing it yourself.

Perhaps Reggie should try to get a more balanced view of Google. I can't say enough monopolies are really bad for the world. Maybe consumers can get some free stuff in the short term. But free doesn't exist. If one person gets a freebee, someone else is getting screwed out of money.

The Internet freed people to produce innovative goods without high start-up costs of having to have bricks-n-mortar shops. I myself started up a company producing a product head-and-shoulders above all of the competition. My website used to be at the top of Google's search results. Whether it is intentional or not, Google have jacked up my advertising costs and bang! in one search algorithm update knocked me off the front page. On bing.com and other alternative search engines, I'm near the top.

When I started out, my website didn't have good natural search results. But I could reach a large number of customers cheaply via cheap click rates. That time has passed now. Google's greed is blocking off the Internet for small companies wishing to start up with limited advertising budgets.

Reggie get a balanced view of what is going on and look at the links below.

Reggie Middleton is a smart man and I always enjoy listening to his insights.

But there is a flip-side to Google and Reggie should think about this as well.

Reggie waxes lyrical about Google’s cost shifting and cheaper-than-free goodies. There is a real cost to this.

I have advertised on Google Adwords for years. That experience has made me dislike Google as a company. I got stung with obvious click fraud. I emailed Google at least twice. They denied click fraud ever takes place. I have paid Google vast sums of money over the years and as a long-standing customer they should have taken the time to examine the evidence I gave them. My whole daily budget was used up immediately at the start of each day on an Indian screensaver website. Yes, immediately. When I turned off the display network, my daily budget wasn’t used up in a whole day when my adverts displayed direct on google.com. Plus I looked in my webserver logs and I had no real visitors from this 3rd party publisher.

Google Adwords contains a mass of code trying to extract as much money as possible for Google from advertisers, even at the expense of making it uneconomic to advertise with them.

I displayed for a while on the display network, where typically the click-through rates are lower. I emailed Google about my eye-wateringly high click costs on the search network. I was told the display network was making my search network costs higher! This is wrong. There should be no linkage between the two as everybody knows the click through rates on the display network as lower than it someone was doing a specific search direct on google.com. If you get low click through rates, Google bumps up your cost per click.

For long stretches of time, I have had no competition in my niche advertising on Google. I sell low cost products and quite frankly none of my competition can afford Google’s high costs in a low product cost market. Yet my click-rates are uneconomically high in the absence of direct competition. This is so wrong. Google's auction model is opaque at best.

Google explains this via broad matching and synonyms. It seems if a big company – with a totally unrelated product to yours – uses broad matching for their keywords, then even only a 1 keyword overlap in a phrase of 3 -4 keywords, will bump up your click costs. This is wrong.

If bing.com can charge $0.05 for a click, then why doe greedy Google need to charge at least a whole order of magnitude more and often much more than that?

I should also mention that I set a daily budget. Google regularly went over that increasing my monthly costs to well over what I can reasonably pay. I searched the Internet and I found out Google has been sued over exceeding peoples’ set budgets.

My response was to set my daily budget 20% below that wish I wish to pay. Everything is geared up by default to sting people – perhaps unintentionally .

So, let's revisit Glass. Glass is a cool device, but from a hardware perspective, it's not expensive to build once engineered. If the Moto X can be sold for $200, that will likely be the ceiling for Glass, which would probably be sold for less if subsidized by Google. Throw in a half billion dollar ad budget (Glass is already extremely popular and is not advertised or even for sale yet) and you have a definite game changer in the mix.

Imagine if these computer glasses that changes the way we do everything sold for $150, with the full marketing awareness powers of Google behind them. Uh Oh, it's a whole new world.

These posts focus on an explicit and stern warning that AIB is drastically undercapitalized and quite possibly the purveyor of a massive fraud on the Irish people, US investors and regulators and German taxpayers.

Second, we anticipated fiscal problems in the Irish state as far back as 2010 when everyone swore that they were the poster child of austerity. Subscribers, see Ireland public finances projections. Professional and institutional subscribers should email me for a link to a live spreadsheet that can allow you to run your own calculations on toasted Ireland's finances really are.

AIB has inccurred significant debt from which the underlying collateral has significantly diminished. This caused the need for even more capital and more borrowing. It also apparently caused it to change the wording in its annual statements regarding repos, potentially allowing it to conceal financial aid in the form of even more debt .from another party. After all, when you borrow something it's a loan right, as in additional debt??? Below, you see a loophole for near unlimited borrowing, and not a peep will show up in the financial reporting!

Of course, theres more...AIB Charge Discrepency

Definitions: Charge - The document evidencing mortgagesecurity required by Crown Law (law derived from English law). A Frixed Charge refers to a defined set of assets and is usually registered. A Floating Charge refers to other assets which change from time to time (ie. cash, inventory, etc.), which become a Fixed Charge after a default.

The charge document below, which was registered with Ireland’s Company Registration Office (CRO), states that the charge is in respect of the Company’s participation in Target 2-Ireland. It is also in respect of ‘all present and future liabilities whatsoever’ of Allied Irish Bank Plc. (to the Central Bank and Financial Services Authority of Ireland or to the European Central Bank). The charge is over ‘Eligible Securities’.

Target2 is a European Union payment system. I believe it is misleading to indicate in the annual accounts that Target 2 has a bearing on the security that has been given.

In the short particulars section of the charge; the property charged to the Central Bank and Financial Services Authority is over ‘all rights, title, interest and benefit, present and future, of AIB Plc. in and to each of the Eligible Securities from time to time, where ‘ Eligible Securities’ means, at any time securities of such a class or description as may from time to time be designated by the ECB as ‘Eligible for Sale and /or Purchase, as the case may be.’ (Refer to actual CRO charge document below)

AIB Charge Discrepency1 copy

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In the Irish version of the Bank’s annual Accounts (2008) and the SEC 20F (page 223 - 2) it states that the charge was placed in favour of the Central Bank and Financial Services Authority of Ireland over all of AIB’S ‘right, title, interest and benefit present and future in and to certain segregated securities.’

Using the description ‘certain segregated securities’ is completely different to the description all ‘eligible securities.’

It appears that AIB is stating that they have given ‘certain segregated securities’ as security to the ECB whereas the ECB actually decides which securities will be designated as ‘eligible’. The charge is in favor of the Central Bank and is over ‘all present and future liabilities whatsoever’ of AIB. This charge is a floating charge over repo agreements, aka Eligible Securities - securities that the graphic above demonstrates can go on ad nauseum and way beyond the entities prudent ability to repay, yet not appear on the balance sheet or in its regulatory reporting!!!. These securities have been purchased by the ECB through the repo agreements.

Thus, it appears as if this floating charge granted to the ECB is over assets that the ECB already owned. The floating charge was given to the ECB by AIB for emergency funding (emergency liquidity). Do you see a circular argument here? A potential Ponzi even???!!!! I warned my paying subscribers three years ago, Beware of the Potential Irish Ponzi Scheme!

For those who don't get it, AIB is essentially asset/equity broke. All properties considered as marketable/acceptable collateral (in other words anything of real, tangible value) jas already been pledged to the ECB. EVERYTHING!!! To the prudent depositor, this is all that needs to be said, but there's more, much more, Irish men and women, prepare to be CYPRUS'D!!!

If you believe that the information above actually identifies a gross misrepresentation of fact, omission or outright fraud, simply contact the SEC and let them know that Reggie Middleton suggested they look into it. You can actually use this form to convey my message.

Remember, extreme wealth concentrates, so you don't have to... Coming from a "Cyprus'd" bank near you!

A little over two years ago I queried "Is Another Banking Crisis Inevitable?". This post attracted the attention of certain ING executives who apparently were asking themsevles the same question. I was invited as the keynote speaker at their valuation conference in Amsterdam wherein I dropped the negative reality bomb! Interest rates were GUARANTEED to spike and when they do, those banks with fictitious bank sheet values and business models predicated upon credit bubble metrics were GUARANTEED to start collapsing.

That visual relationship is corroborated by running the statistical correlations...

The relationship is obvious and evident! In addition, we have been in a Goldilocks fantasy land for both interest rates and CRE for about 30 years. CRE culminated in the 2007 bubble pop, but was reblown by .gov policies and machinations. The same with rates. Ever hear of NEGATIVE interest rates where YOU have to PAY someone to LEND THEM MONEY!!!

So, BoomBustBloggers, where do YOU think rates are going to go from here? Up of Down???

Taped telephone recordings (from the bank's own systems) from inside doomed Anglo Irish Bank reveal for the first time how the bank's top executives lied to the Government about the true extent of losses at the institution.

... Anglo itself was within days of complete meltdown – and in the years ahead would eat up €30bn of taxpayer money. Mr Bowe speaks about how the State had been asked for €7bn to bail out Anglo – but Anglo's negotiators knew all along this was not enough to save the bank.

... The plan was that once the State began the flow of money, it would be unable to stop. Mr Bowe is asked by Mr Fitzgerald how they had come up with the figure of €7bn. He laughs as he is taped saying: "Just, as Drummer (then-CEO David Drumm) would say, 'picked it out of my arse'."

... Mr Bowe's comments in the audio recording reveal that Anglo's strategy was to lure the State in, leaving taxpayers with no choice but to continue to provide loans to "support their money".

... "If they (Central Bank) saw the enormity of it up front, they might decide they have a choice. You know what I mean?

"They might say the cost to the taxpayer is too high . . . if it doesn't look too big at the outset . . . if it looks big, big enough to be important, but not too big that it kind of spoils everything, then, then I think you have a chance. So I think it can creep up."

Mr Fitzgerald, the Director of Retail Banking, is heard saying: "Yeah. They've got skin in the game and that is the key."

... The recording also shows Mr Bowe and Mr Fitzgerald laughing as they say how there is no realistic chance of ever repaying the loans.

For the first time, taxpayers get an exclusive insight into the banking shenanigans that cost Ireland our sovereignty.

With rates spiking and equities dropping, all due to the long overdue realization that Bernanke can't goose the markest forever, I take this time to review my many warnings of this moment as it it approaches.

Reggie Middleton Featured in Property EU, one of Europe's leading real estate publications